Infinity Energy, Inc. v. Prestige Investments Worldwide, LLC

• Court: District Court, E.D. California
• Decided: May 31, 2023
• Docket: 2:21-cv-00438
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 INFINITY ENERGY, INC., a No. 2:21-cv-00438 WBS KJN California Corporation, 13 Plaintiff, 14 MEMORANDUM AND ORDER RE: v. DEFENDANT’S MOTION FOR 15 SUMMARY JUDGMENT INFINITE ENERGY HOME 16 SERVICES, INC., a California Corporation, 17 Defendant. 18

19 ----oo0oo---- 20 Plaintiff Infinity Energy, Inc., brought this action 21 against defendant Infinite Energy Home Services, Inc., alleging 22 trademark infringement under the Lanham Act, 15 U.S.C. § 1114; 23 false designation of origin under 15 U.S.C. § 1125; violation of 24 California’s Unfair Competition Law, Cal. Bus. & Prof. Code § 25 17200; and intentional interference with prospective economic 26 advantage under California law. (FAC (Docket No. 7).) Defendant 27 now moves for summary judgment. (Mot. (Docket No. 33).) 28 1 I. Factual Background 2 Plaintiff provides solar energy services and does 3 business in California, Texas, Nevada, Idaho, Florida, Colorado, 4 and New Jersey. (See id. ¶¶ 10, 17.) Plaintiff has a registered 5 trademark for the name “Infinity Energy” in connection with the 6 installation of solar energy systems and alternative energy 7 products for residential and commercial use. (Def.’s Statement 8 of Undisputed Facts (“SUF”) (Docket No. 33-4) ¶ 1.) 9 Defendant uses the name Infinite Energy or Infinite 10 Energy Home Services to market its solar energy services, as well 11 as other home-related services. (See id. ¶¶ 14, 16, 43.) 12 Defendant does business in El Dorado County, Placer County, and 13 Sacramento County in California. (Id. ¶ 18.) Defendant does not 14 do any business outside those three counties. (See id.) 15 II. Legal Standard 16 Summary judgment is proper “if the movant shows that 17 there is no genuine dispute as to any material fact and the 18 movant is entitled to judgment as a matter of law.” Fed. R. Civ. 19 P. 56(a). A party may move for summary judgment either for one 20 or more claims or defenses, or for portions thereof. Id. Where 21 a court grants summary judgment only as to a portion of a claim 22 or defense, it “may enter an order stating any material fact . . 23 . that is not genuinely in dispute and treating the fact as 24 established in the case.” Id. at 56(g). 25 A material fact is one “that might affect the outcome 26 of the suit under the governing law,” and a genuine issue is one 27 that could permit a reasonable trier of fact to enter a verdict 28 in the non-moving party’s favor. Anderson v. Liberty Lobby, 1 Inc., 477 U.S. 242, 248 (1986). The moving party bears the 2 initial burden of establishing the absence of a genuine issue of 3 material fact and may satisfy this burden by presenting evidence 4 that negates an essential element of the non-moving party’s case. 5 See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). 6 Alternatively, the movant may demonstrate that the non-moving 7 party cannot provide evidence to support an essential element 8 upon which it will bear the burden of proof at trial. Id. The 9 burden then shifts to the non-moving party to set forth specific 10 facts to show that there is a genuine issue for trial. See id. 11 at 324. Any inferences drawn from the underlying facts must, 12 however, be viewed in the light most favorable to the non-moving 13 party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 14 475 U.S. 574, 587 (1986). 15 III. Discussion 16 A successful trademark infringement claim requires a 17 showing that the claimant holds a protectable mark and that the 18 alleged infringer’s imitating mark is similar enough to “cause 19 confusion, or to cause mistake, or to deceive.” KP Permanent 20 Make–Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 117 21 (2004). Defendant moves for summary judgment on the basis that 22 there is no likelihood of confusion. 23 A likelihood of confusion exists “when consumers are 24 likely to assume that a product or service is associated with a 25 source other than its actual source because of similarities 26 between the two sources’ marks or marketing techniques.” 27 Nutri/System, Inc. v. Con–Stan Indus., Inc., 809 F.2d 601, 604 28 (9th Cir. 1987). In AMF Inc. v. Sleekcraft Boats, 599 F.2d 341 eee em EIEIO IN IDE IE SIRE IE EI OEE EN

1 (9th Cir. 1979), the Ninth Circuit delineated eight factors to be 2 considered as part of the consumer confusion inquiry. Id. at 3 348-49. The Sleekcraft factors are: (1) the similarity of the 4 marks; (2) the strength of the plaintiff’s mark; (3) the 5 relatedness or proximity of the goods; (4) the marketing channels 6 used by each party; (5) the degree of care likely to be exercised 7 by the purchaser; (6) the defendant's intent in selecting the 8 | mark; (7) evidence of actual confusion; and (8) the likelihood of 9 expansion of the parties’ product lines. Id. These factors “are 10 non-exhaustive and applied flexibly.” JL Beverage Co., LLC v. 11 Jim Beam Brands Co., 828 F.3d 1098, 1106 (9th Cir. 2016). 12 A. Similarity of the Marks 13 “The first Sleekcraft factor -- the similarity of the 14 | marks -- has always been considered a critical question in the 15 likelihood-of-confusion analysis.” GoTo.com, Inc. v. Walt Disney 16 Co., 202 F.3d 1199, 1205 (9th Cir. 2000). To determine the 17 Similarity of marks, “first, the marks must be considered in 18 their entirety and as they appear in the marketplace; second, 19 similarity is adjudged in terms of appearance, sound and meaning; 20 and third, similarities are weighed more heavily than 21 differences.” Id. (internal citations omitted). 22 Plaintiff’s mark appears in the marketplace as 23 “infinity energy” with a small logo incorporating the infinity 24 symbol to the left of the company name, using a pale green and 25 grey color scheme, as shown below. (Def.’s SUF FT 42.) 26 G 6 @ ee infinity 28 energy

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1 The parties dispute how defendant’s mark appears in the 2 marketplace. Defendant contends that its mark appears as 3 “INFINITE ENERGY HOME SERVICES,” with the descriptors “Solar - 4 Roofing - Electrical - Home Battery - HVAC - Windows” appearing 5 below the company name, along with a large logo incorporating the 6 infinity symbol above the company name, using a medium green and 7 | black color scheme. (Def.’s SUF J 43.) Plaintiff contends that 8 defendant changed its mark following the initiation of this 9 action, but previously used only “INFINITE ENERGY” as its mark, 10 and continues to use the “INFINITE ENERGY” mark alongside the 11 updated “INIFINITE HOME ENERGY SERVICES” mark, as shown below. 12 (Pl.’s Statement of Disputed Facts (Docket No. 40-3) J 43.) 13 gm 14 OS) INFINITE VA wd ENERGY INFINITE 16 ENERGY HOME SERVICES 17 Soue-fone- —Howe AC 18 The marks are not so dissimilar that summary judgment 19 is warranted. To the contrary, the names “Infinite Energy” and 20 “Infinity Energy” are very similar; “infinite” and “infinity” 21 refer to the same concept, sound similar when spoken, and 22 visually differ by only a single letter. See GoTo.com, 202 F.3d 23 at 1205 (appearance, sound, and meaning are considered in 24 determining similarity). Even assuming that defendant’s 25 representation of its mark is accurate and that it always 26 includes the additional descriptors listed above, defendant 27 admits that it also uses the name “Infinite Energy” in the 28 marketplace. (See SUF 7 14.) Regardless, the addition of “Home

1 Services” does not necessarily negate the linguistic similarity 2 of the names. See Rearden LLC v. Rearden Com., Inc., 683 F.3d 3 1190, 1212 (9th Cir. 2012) (reasonable juror could find 4 likelihood of confusion despite addition of a word to company 5 name); GoTo.com, 202 F.3d at 1205 (similarities are weighed more 6 heavily than differences). Further, both companies utilize a 7 logo incorporating the infinity symbol and a green color scheme. 8 See GoTo.com, 202 F.3d at 1206 (colors and shapes used in logos 9 are relevant in analyzing similarity). There is therefore at 10 least a question of material fact as to the similarity of the 11 marks, which weighs against granting summary judgment. 12 B. Strength of the Mark 13 “A mark’s strength is ‘evaluated in terms of its 14 conceptual strength and commercial strength.’” JL Beverage Co., 15 828 F.3d at 1106 (quoting GoTo.com, 202 F.3d at 1207). 16 “A mark’s conceptual strength ‘depends largely on the 17 obviousness of its connection to the good or service to which it 18 refers.’” Id. at 1107 (quoting Fortune Dynamic, 618 F.3d at 19 1032–33). Conceptual strength is determined by the mark’s 20 placement on a continuum of increasing distinctiveness: (1) 21 generic (2) descriptive, (3) suggestive, (4) arbitrary, and (5) 22 fanciful. See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 23 763, 768 (1992). As the uniqueness of the mark increases, so too 24 does the degree of protection. JL Beverage Co., 828 F.3d at 25 1106. 26 “Arbitrary and fanciful marks, which employ words and 27 phrases with no commonly understood connection to the product, 28 are the two strongest categories, and trigger the highest degree 1 of trademark protection.” Id. at 1107 (internal quotation marks 2 omitted). “In the middle of the spectrum are suggestive marks, 3 which suggest a product’s features and require consumers to 4 exercise some imagination to associate the suggestive mark with 5 the product.” Id. “Descriptive and generic marks, at the other 6 end of the spectrum, are the two weakest categories. Descriptive 7 marks define a particular characteristic of the product in a way 8 that does not require any imagination, while generic marks 9 describe the product in its entirety and are not entitled to 10 trademark protection.” Id. 11 At best, plaintiff’s mark “Infinity Energy” fits into 12 either the “suggestive” category because it requires one to 13 presume the nature of the program or services, or the 14 “descriptive” category because it references some of the 15 characteristics of plaintiff’s services. See id. This would 16 place plaintiff’s mark on the weak-to-moderate portion of the 17 continuum. 18 In contrast to conceptual strength, commercial strength 19 “is based on actual marketplace recognition.” Network 20 Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 21 1149 (9th Cir. 2011). “Commercial strength may be demonstrated 22 by commercial success, extensive advertising, length of exclusive 23 use, and public recognition.” Boler v. 3D Int’l, LLC, No. 2:14- 24 cv-00658 TLN CKD, 2018 WL 5099274, at *4 (E.D. Cal. Oct. 17, 25 2018); see also Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 26 1144 (9th Cir. 2002). A “suggestive or descriptive mark, which 27 is conceptually weak, can have its overall strength as a mark 28 bolstered by its commercial success.” M2 Software, Inc., v. 1 Madacy Ent., 421 F.3d 1073, 1081 (9th Cir. 2005). 2 Plaintiff argues that its mark is commercially strong 3 because its service area has expanded from Northern California to 4 seven U.S. states, including a significant amount of business in 5 the area also serviced by defendant. (See Opp’n (Docket No. 40) 6 at 2; Def.’s SUF ¶ 17.) Such evidence can be relevant. See JL 7 Beverage Co., 828 F.3d at 1109 (suggesting that geographic scope 8 of sales is relevant in evaluating commercial strength). 9 However, the geographic scope of plaintiff’s services, without 10 more, does not appear sufficient to establish actual marketplace 11 recognition. See Brookfield Commc’ns, Inc. v. W. Coast Ent. 12 Corp., 174 F.3d 1036, 1058 (9th Cir. 1999) (indicating that a 13 plaintiff must provide “substantial evidence establishing the 14 widespread recognition of its mark” to establish commercial 15 strength). Plaintiff has not provided any other evidence of 16 commercial strength, for example “extensive advertising, length 17 of exclusive use, and public recognition.” See Boler, 2018 WL 18 5099274, at *4. The court therefore concludes that, based on the 19 evidence before it, plaintiff’s mark receives weak to moderate 20 protection, which weighs somewhat in favor of granting summary 21 judgment in defendant’s favor; however, this factor alone is not 22 dispositive. 23 C. Proximity of the Goods 24 “Related goods are generally more likely than unrelated 25 goods to confuse the public as to the producers of the goods.” 26 Brookfield, 174 F.3d at 1055. “For related goods, the danger 27 presented is that the public will mistakenly assume there is an 28 association between the producers of the related goods, though no 1 such association exists.” Sleekcraft, 599 F.2d at 350. It is 2 undisputed that both parties provide solar energy installation 3 services. The services are therefore closely related, if not 4 identical. See Stone Creek, Inc. v. Omnia Italian Design, Inc., 5 875 F.3d 426, 432 (9th Cir. 2017), abrogated on other grounds, 6 Romag Fasteners, Inc. v. Fossil, Inc., 140 S. Ct. 1492 (2020) 7 (indicating that goods that are “identical” or directly 8 “competitive” are close in proximity). The similarity of the 9 services increases the likelihood of confusion and thus weighs 10 against granting summary judgment in favor of defendant. 11 D. Marketing Channels Used 12 “[C]onvergent marketing channels increase the 13 likelihood of confusion.” Off. Airline Guides, Inc. v. Goss, 6 14 F.3d 1385, 1393 (9th Cir. 1993). Here, both parties utilize 15 internet advertising. However, some use of the internet for 16 marketing alone does not constitute overlapping marketing 17 channels. Entrepreneur Media, 279 F.3d at 1151. Instead, the 18 court must examine “whether both parties use the Web as a 19 substantial marketing and advertising channel . . . and whether 20 the parties’ marketing channels overlap in any other way.” Id. 21 (emphasis in original). There is insufficient evidence here 22 concerning the nature of the parties’ internet advertising to 23 determine whether that usage is “significant.” Additionally, 24 there is evidence that defendant uses other marketing channels, 25 including billboards and radio (see Def.’s Interrogs. (Docket No. 26 40-4) at 6); however, neither party addresses the extent of 27 plaintiff’s use (or lack thereof) of non-internet marketing 28 methods. Accordingly, there is a question of material fact on 1 the issue of marketing channels, which weighs against summary 2 judgment. 3 E. Type of Goods and Degree of Care 4 “Low consumer care . . . increases the likelihood of 5 confusion.” Playboy Enter., Inc. v. Netscape Commc’ns Corp., 354 6 F.3d 1020, 1028 (9th Cir. 2004). “In assessing the likelihood of 7 confusion to the public, the standard used by the courts is the 8 typical buyer exercising ordinary caution.” Network Automation, 9 638 F.3d at 1152 (quoting Sleekcraft, 599 F.2d at 353). “[W]hen 10 the goods are expensive, the buyer can be expected to exercise 11 greater care in his purchases . . . though, confusion may still 12 be likely.” Id. (quoting Sleekcraft, 599 F.2d at 353). 13 The parties fail to present any information concerning 14 the price of their services, though their briefing suggests that 15 the cost of solar energy services is substantial. Assuming the 16 prices of the parties’ services are on the higher end, this 17 suggests that customers are more likely to exercise a higher 18 degree of care. See id. However, this factor is “less 19 instructive” when –- as here -- there is a high degree of 20 similarity between the marks and the goods. See Stone Creek, 875 21 F.3d at 435. 22 F. Defendant’s Intent in Selecting the Mark 23 While “an intent to confuse consumers is not required 24 for a finding of infringement,” Brookfield, 174 F.3d at 1059, an 25 intent to deceive can be strong evidence of a likelihood of 26 confusion, Sleekcraft, 599 F.2d at 354. Plaintiff does not 27 appear to dispute that defendant had no ill intent in selecting 28 its mark. (See Opp’n at 7.) Such a lack of intent to deceive is 1 “largely irrelevant” in determining likelihood of confusion. See 2 Brookfield, 174 F.3d at 1059. 3 G. Evidence of Actual Confusion 4 Evidence of actual confusion is strong evidence that 5 future confusion is likely. Nutri/System, 809 F.2d at 606. 6 “Such evidence is not necessary for a finding of likelihood of 7 confusion, but . . . is particularly potent.” Stone Creek, 875 8 F.3d at 433. 9 Here, plaintiff’s Chief Sales Officer provided 10 testimony concerning numerous instances in which customers of 11 defendant’s business have erroneously contacted plaintiff, 12 intending to contact defendant.1 (See Dep. of Cameron Kelly 13 (Docket No. 40-4 at 14-23) at 57.) Also before the court is a 14 copy of an email from a customer who defendant admits intended to 15 contact defendant with a complaint about defendant’s services, 16 but erroneously contacted plaintiff. (See Mot. at 24-25; Def.’s 17 Ex. W (Docket No. 35 at 155-58)). Further, plaintiff’s expert 18 opines that an analysis of the two companies’ internet presences 19 provides evidence of actual confusion. (See Decl. and Exp. Rep. 20 of Dr. Patrick Farrell (Docket No. 35 at 79-87) ¶¶ 18-25.) Taken 21

22 1 Defendant argues that this witness’s testimony should be disregarded because it relies upon inadmissible hearsay. 23 However, this objection is not necessarily applicable on summary judgment. “If the contents of a document can be presented in a 24 form that would be admissible at trial -- for example, through live testimony by the author of the document -- the mere fact 25 that the document itself might be excludable hearsay provides no basis for refusing to consider it on summary judgment.” Sandoval 26 v. County of San Diego, 985 F.3d 657, 666 (9th Cir. 2021). Here, 27 defendant has not shown, and the court does not see, why the contents of the documents or anticipated testimony at issue could 28 not possibly be properly presented at trial. 1 together, this evidence is sufficient to establish a question of 2 material fact on the issue of actual confusion. This factor 3 therefore weighs against granting summary judgment in favor of 4 defendant. 5 H. Likelihood of Expansion of the Product Lines 6 “Inasmuch as a trademark owner is afforded greater 7 protection against competing goods, a strong possibility that 8 either party may expand his business to compete with the other 9 will weigh in favor of finding that the present use is 10 infringing.” Sleekcraft, 599 F.2d at 354 (citation omitted). 11 This factor is relevant where two companies are not yet 12 competitors but might become so in the future; however, “[w]here 13 two companies are direct competitors, this factor is 14 unimportant.” See Network Automation, 638 F.3d at 1153. The 15 parties seem to agree that the companies are direct competitors 16 in providing solar services. (See Mot. at 30; Opp’n at 3, 7.) 17 This factor thus has little weight. 18 In light of the evidence presented by the parties 19 concerning the Sleekcraft factors -- particularly the similarity 20 of the marks, the proximity of the goods, and evidence of actual 21 confusion -- the court concludes that there is at the very least 22 a question of material fact as to whether there is a likelihood 23 of customer confusion. 24 IT IS THEREFORE ORDERED that defendant’s motion for 25 summary judgment (Docket No. 33) be, and the same hereby is, 26 DENIED.2 27 2 Defendant also requests that the court grant summary 28 judgment on the issue of damages. However, the parties’ briefs —ee—ee em REI INE II OI IO IRIE EI IE OSE EEE eee

1 Dated: May 31, 2023 ih thew VS. (hh y ’ WILLIAM B. SHUBB 2 UNITED STATES DISTRICT JUDGE 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 contain little discussion of this issue, and given that questions 29 of fact remain on the issue of liability, it is premature to 26 address damages. Regardless, defendant’s argument -- that plaintiff must prove actual damages to recover on any of its 27 claims -- is incorrect. The Lanham Act explicitly provides for monetary recovery without proof of actual damages. See 15 U.S.C. 28 | § 1117(c). 13